IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

Joe Hand Promotions, Inc.,

Plaintiff,

v. Case No. 2:11-cv-377

RPM Management Co. LLC,

et al.,

Defendants.

OPINION AND ORDER

This is an action brought by plaintiff Joe Hand Promotions

against defendant RPM Management Co., LLC, individually and as the

alter ego of Ozone Sports Bar, and defendant Mark Lokar. Plaintiff

is an international distributor of sports and entertainment

programming. Plaintiff alleges that it purchased the rights to

broadcast a mixed martial arts match entitled the “Ultimate

Fighting Championship 98: Rashad Evans v. Lyoto Machida” (“the

Program”) shown on May 23, 2009. Defendants allegedly broadcast

the program at the Ozone Sports Bar without purchasing a sublicense

from plaintiff to do so.

In Count 1 of its complaint filed on May 2, 2011, plaintiff

asserts a claim under the Communications Act of 1934, as amended,

47 U.S.C. §605, et seq. In Count 2, plaintiff alleges a violation

of the Cable and Television Consumer Protection and Competition Act

of 1992, as amended, 47 U.S.C. §553, et seq. Count 3 of the

complaint asserts a claim for conversion.

The record indicates that defendants were served with a

summons, which was returned executed. After defendants failed to

file an answer, plaintiff filed an application for entry of

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default. The clerk entered default on July 11, 2011. This matter

is now before the court on plaintiff’s motion for default judgment

filed on July 22, 2011. On October 5, 2011, this court entered an

order directing the clerk to mail a copy of plaintiff’s motion for

default judgment to the defendants via certified mail, and

directing the defendants to respond to the motion no later than

November 4, 2011. The certified mail receipts indicate that

defendants received this order. No response to the motion has been

filed.

Fed.R.Civ.P. 55(b) governs default judgment. Once a default

is entered, the defendants are considered to have admitted all of

the well-pleaded allegations in the complaint. Ford Motor Co. v.

Cross, 441 F.Supp.2d 837, 845 (E.D.Mich. 2006)(citing Matter of

Visioneering Construction, 661 F.2d 119, 124 (6th Cir. 1981)). 

However, while the well-pleaded factual allegations in the

complaint are taken as true when a defendant is in default, damages

are not. Ford Motor Co., 441 F.Supp.2d at 848. Where damages are

unliquidated, a default admits only defendant’s liability and the

amount of damages must be proved. Antoine v. Atlas Turner, Inc.,

66 F.3d 105, 110 (6th Cir. 1995). Although the court may conduct

an evidentiary hearing to determine damages, an evidentiary hearing

is not a prerequisite to the entry of default judgment if damages

are contained in documentary evidence or detailed affidavits and

can be ascertained on the record before the court. J&J Sports

Production, Inc. v. Lukes, No. 1:10 CV 00535, 2010 WL 4105663 at *1

(N.D.Ohio Oct. 18, 2010).

Title 47, §605(a) prohibits the unauthorized interception of

radio communications. That section has been interpreted as

outlawing satellite signal piracy. Cablevision of Michigan, Inc.

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v. Sports Palace, Inc., 27 F.3d 566 (table), 1994 WL 245584 at *3

(6th Cir. June 6, 1994). Section 605 permits the aggrieved party

to recover actual damages or statutory damages of not less than

$1,000 or more than $10,000 for each violation. 47 U.S.C.

§605(e)(3)(C)(i)(I) and (II). There are no mens rea or scienter

elements for a non-willful violation of that section; rather, it is

a strict liability offense, and intent is immaterial to liability. 

Joe Hand Promotions, Inc. v. Easterling, No. 4:08 CV 1259, 2009 WL

1767579 at *4 (N.D.Ohio June 22, 2009)(citing Int’l Cablevision,

Inc. v. Sykes, 997 F.2d 998, 1004 (2d Cir. 1993) and Kingvision Pay

Per View Ltd. v. Williams, 1 F.Supp.2d 1481, 1484 (S.D.Ga. 1998)).

Where the court finds that the violation was committed

willfully and for purpose of commercial advantage or private

financial gain, the court, in its discretion, may increase the

award of actual or statutory damages by an amount not to exceed

$50,000. 47 U.S.C. §605(e)(3)(C)(ii). Section 605 also permits an

award of costs and reasonable attorney’s fees. 47 U.S.C.

§605(e)(3)(B)(iii).

It is illegal under 47 U.S.C. §553(a)(1) to intercept or

receive without authorization any communications service offered

over a cable system. Section 553 bans the theft of programming

directly from a cable system. Id. Under §553, a party may recover

actual damages, or, in the alternative, an award of statutory

damages for all violations involved in the action in an amount not

less than $250 but not greater than $10,000. 47 U.S.C.

§553(c)(3)(A)(i) and (ii). This is likewise a strict liability

statute. Easterling, 2009 WL 1767579 at *4. Where the court finds

that the violation was committed willfully and for purpose of

commercial advantage or private financial gain, the court, in its

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discretion, may increase the award of damages, either actual or

statutory, by an amount not more than $50,000. 47 U.S.C.

§553(c)(3)(B). Section 553 also provides for an award of costs and

reasonable attorney’s fees. 47 U.S.C. §553(c)(2)(C).

Courts have held that when a defendant is liable under both

§553 and §605, a plaintiff may recover under only one section. See

Sykes, 75 F.3d at 129; Joe Hand Promotions Inc. v. Orim, Inc., No.

1:10CV00743, 2010 WL 3931108 at *2 (N.D.Ohio Oct. 5, 2010); Joe

Hand Promotions, Inc. v. Willis, No. 5:08CV2786, 2009 WL 369511 at

*1 (N.D.Ohio Feb. 11, 2009). In that situation, typically §605 is

applied because it allows for a higher recovery.

In awarding statutory damages for non-willful infractions,

courts may consider the price a defendant would have had to pay to

obtain the right to receive and display a broadcast, and the

plaintiff’s cost to monitor and investigate its broadcasting

rights. Joe Hand Promotions, Inc. v. Potopsky, No. 1:10-cv-1474,

2011 WL 2648620 at *4 (N.D.Ohio July 6, 2011). In this case,

plaintiff has submitted the affidavit of Joe Hand, Jr., president

of Joe Hand Promotions. Mr. Hand stated in his affidavit that

plaintiff is a closed-circuit distributor of sports and

entertainment programming. Hand Aff., ¶ 3. Plaintiff purchased

the rights to the Program, which was broadcast on May 23, 2009. 

Hand Aff., ¶ 3. Plaintiffs have also presented the affidavit of

Investigator F. Ann Grimm, who was present at the Ozone Sports Bar

from 11:50 p.m. on May 23, 2009, to 12:15 a.m. on May 24, 2009. 

Ms. Grimm stated that she observed a portion of the Program,

specifically, the under-card bout between Matt Hughes and Matt

Serra, being broadcast on sixteen television screens in the bar. 

Grimm Aff.; Hand Aff. ¶ 7. The Ozone Sports Bar was not licensed

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by plaintiff to show the Program. Hand Aff. ¶ 7. According to the

rate card for the Program, the commercial fee which would have been

charged for defendants to broadcast the Program was $1,150.00. 

This was based on the fact that the Ozone Sports Bar had a capacity

of 175 people. See Hand Aff., ¶ 8; Grimm Aff. Plaintiff has

submitted no information concerning what expenses, if any, it

incurred in investigating this particular infraction. Thus, the

statutory damages payable under §605(e)(3)(C)(i)(I) and (II) would

be $1,150.00.

However, plaintiff argues that it is entitled to enhanced

damages under §605(e)(3)(C)(ii) for a willful violation. Conduct

is “willful” if it shows “disregard for the governing statute and

an indifference to its requirements.” Transworld Airlines, Inc. v.

Thurston, 469 U.S. 111, 127 (1985). For purposes of §605, conduct

is “willful” where there were repeated violations over time. 

Easterling, 2009 WL 1767579 at *6, n. 2 (citing Cable/Home

Communication Corp. v. Network Prod. Inc., 902 F.2d 829, 851 (11th

Cir. 1990)). The court may also draw an inference of willfulness

from a defendant’s failure to appear and defend an action in which

the plaintiff demands increased statutory damages based on

allegations of willful conduct. Id. 

In this case, plaintiff has submitted evidence that it would

be impossible to mistakenly or accidently intercept the Program. 

A black box, hotbox or pancake box would have to be installed on a

cable television line to allow for the descrambled reception of a

pay-per-view broadcast, and the use of a smart card, test card or

programming card would have to be installed on a DSS satellite

receiver line to allow for the descrambled reception of a pay-perview broadcast. Other methods of piracy would include a

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misrepresentation by a commercial establishment that it was a

residence for purposes of purchasing a pay-per-view program, the

use of an illegal cable drop or splice from an apartment or home

near the commercial establishment, or the purchase of other illegal

decryption devices or satellite authorization codes. Hand Aff.

¶ 9.

The court observes that defendants failed to appear and defend

this action, which alleged willful violations of §605 and §553. 

Plaintiff also notes that defendants have committed other

violations in the past, noting specifically previous judgments

entered in this court against defendants in Joe Hand Promotions,

Inc. v. RPM Management Co. LLC, No. 2:09-cv-862, 2011 WL 1043574

(S.D.Ohio Mar. 18, 2011)(Sargus, J.)(involving the illegal

broadcast of a professional prize fight at the Ozone Sports Bar on

March 1, 2008) and Joe Han Promotions, Inc. v. RPM Management Co.

LLC, No. 2:09-cv-553, 2011 WL 1043560 (S.D.Ohio Mar. 18,

2011)(Sargus, J.)(involving the illegal broadcast of a professional

prize fight at the Ozone Sports Bar on July 7, 2007). Thus, the

court finds that there is sufficient evidence that the violations

in this case were willful.

Plaintiff must also show that the violation was committed for

purpose of commercial advantage or private financial gain. Other

courts have held that this requirement is not satisfied where there

was no evidence of a cover charge, no evidence that the program was

advertised or that food or drink prices were increased, and where

the establishments were not filled to capacity. See Lukes, 2010 WL

4105663 at *3 (noting that at the time of broadcast, the bar’s

capacity was sixty, but only twenty-two patrons were present, there

was no cover charge, and the bar had one television); Easterling,

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2009 WL 1767579 at *6 (evidence of willful exhibition for financial

gain insufficient where there were at most seventy-two patrons

present in bar which held up to one hundred and twenty customers,

there was no cover charge, and there was no evidence that the event

was advertised or that food prices were increased). However, in

each of the previous two actions between plaintiff and defendants

filed in this court, enhanced damages in the amount of $20,000 were

awarded. In Joe Hand Promotions, Inc. v. McBroom, No. 5:09-cv276(CAR), 2009 WL 5031580 at *6 (M.D.Ga. Dec. 15, 2009), the court

awarded enhanced damages of $3,300 (three times the amount of the

licensing fee of $1,100) even though there was no evidence of

repeated violations, that a cover fee was charged, or that the

event was advertised, and where the restaurant, which had a

capacity of two hundred persons, had eight customers on the night

of the broadcast.

Plaintiff argues that the fact that a pirated event is not

advertised does not indicate the lack of a purpose to profit from

the event, since pirates do not generally advertise the fact that

they intend to unlawfully exhibit programming. Hand Aff. ¶ 15. 

Mr. Hand stated that, based on his experience, it is uncommon for

licensees who legally broadcast programs to increase food or

beverage prices to recover the cost of the license. Hand Aff. ¶

16. He also indicated that most pirate establishments do not

charge a cover because to do so would defeat their purpose of

obtaining a competitive advantage by not charging a cover fee for

the event, thereby attracting customers away from licensed

establishments. Hand Aff. § 17.

In this case, the evidence includes three separate head counts

of seventy-two, seventy and seventy-eight patrons present at the

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Ozone Sports Bar while the investigator was there. See Grimm Aff. 

This was a sizable audience, considering the bar’s capacity of 175

persons and the fact that the Program was broadcast around

midnight. Also significant is that the establishment had sixteen

television screens, all of which were showing the Program. The

Ozone Sports Bar, by its very name, advertised itself as a venue

for viewing sports events such as the Program at issue in this

case. It would be incongruous to argue that a sports bar did not

intend to make a profit from food and beverage sales by

broadcasting a sporting event which would attract patrons to the

bar. The court concludes that there is sufficient evidence that

the willful violation in this case was committed for the purpose of

commercial advantage or private financial gain. In light of the

multiple violations committed by defendants, the court finds that

enhanced statutory damages in the amount of $25,000.00 is an

appropriate award in this case.

Plaintiff is also entitled to an award of attorney’s fees and

costs. In this case, plaintiff has submitted an affidavit from

counsel claiming $1,300.00 in attorney’s fees and $350.00 in costs. 

The court finds that an award in these amounts is reasonable. 

Therefore, the court also awards the plaintiff $1,300.00 in

attorney’s fees and $350.00 in costs.

In accordance with the foregoing, plaintiff’s motion for

default judgment (Doc. 12) is granted. The clerk shall enter

judgment in favor of plaintiff and against the defendants, jointly

and severally, in the total amount of $26,650.00, consisting of

$25,000.00 in statutory damages for a willful violation of §605,

committed with the purpose of commercial advantage or financial

gain, $1,300.00 in attorney’s fees, and $350.00 in costs.

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It is so ordered. 

Date: November 7, 2011 s/James L. Graham 

 James L. Graham

 United States District Judge

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